Karnataka Farm Loan Waiver: Chief Minister Siddaramaiah in the state Assembly today announced the crop loan waiver of up to Rs 50,000 per farmer which is set to cost the state exchequer Rs 8,165 crore.

Karnataka Farm Loan Waiver: Chief Minister Siddaramaiah in the state Assembly today announced the crop loan waiver of up to Rs 50,000 per farmer which is set to cost the state exchequer Rs 8,165 crore, according to a PTI report. Only a total number of 22,27,506 farmers who obtained their short term crop loans from the cooperative banks will enjoy the benefits of the loan waiver announced in the Karnataka Assembly today. CM Siddaramaiah before announcing the farm loans said, “Farmers are in distress. They have been demanding loan waiver. We have to respond to farmers, even though it will have an impact on state’s finances,” as quoted in the report.

Further while talking about the move to waive off farmer’s loans up to Rs 50,000 which is restricted to the farmers who obtained their short-term loans from cooperative banks, CM said that this step is being taken in the interest of agriculture sector. He added, that the government has decided to come to the rescue of 22,27,506 farmers and waived their crop loan or a short-term loan from cooperative banks, outstanding till yesterday, by Rs 50,000 on each farmer. He also sais that Rs 10,736 crore loans have been obtained by 22,27,506 farmers from the cooperative banks in the state.

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Siddaramaiah further dragged the PM Narendra Modi-led NDA government into the conversation and said that now the Centre will have to come to the rescue of farmers by waiving the loan obtained by them from nationalized and Grameen banks. He further added that loans obtained by the cooperative banks only amount to 20 per cent of the total loan obtained by the farmers. 80 per cent of the total loan is from Grameen, nationalized and others banks that come under the ambit of the central government, as quoted in the report.

This loan waiver to farmers is the political gimmick to win the support of farmers before assembly elections due in 2018 in Karnataka. This step will not solve poverty and backwardness of farmers. The govt must ensure the realistic price of food grains grown by farmers by finalizing foolproof marketing strategy which ensures no loss to poor farmers. This can only be possible if govt makes arrangement for the purchase of main food grains like wheat, paddy, cereals and other items on realistic price considering the cost of production and reasonable profit to farmers. So state govt must chalk out a foolproof corruption free system honestly and efficiently to help farmers rather than fooling them by this casual waiver.